- U.S. equities dropped on Friday, May 19, 2023 as debt ceiling talks were put on pause.
- Shares of Foot Locker plummeted as the shoe retailer reported profit and sales that missed analysts’ forecasts.
- The Dow, S&P 500, and Nasdaq posted weekly gains, despite today’s losses.
U.S. equities ended the week in the red after Republicans involved in talks to raise the government’s debt ceiling called for a pause in the negotiations, charging the White House with being “unreasonable.”
That put a damper on optimism a deal would be reached soon, which had helped fuel market gains this week. Easing concerns, however, were comments from Fed Chair Jerome Powell, who suggested policymakers won’t have to raise interest rates as high as anticipated to get inflation under control.
The Dow, S&P 500, and Nasdaq posted weekly gains, despite Friday’s losses. The Dow added 0.4%, the S&P 500 picked up 1.6%, and the Nasdaq jumped 3% for the week.
Shares of Foot Locker (FL) plummeted as the shoe retailer reported profit and sales that missed analysts’ forecasts, and slashed its outlook. That caused a ripple effect in the sector, sending shares of rivals V.F. Corporation (VFC), Nike (NKE), and Under Armour (UA) sinking as well.
Walt Disney (DIS) shares slumped on an analyst downgrade. Shares of Digital Realty Trust (DLR) tumbled after Citigroup cut its price target. Shares of Zions Bancorporation (ZION), KeyCorp (KEY), and other regional banks fell.
Catalent (CTLT) shares soared as the contract drug maker made positive comments about its business. Shares of oil and gas companies advanced, with Pioneer Natural Resources (PXD), EOG Resources (EOG), APA Corporation (APA), and Devon Energy Corporation (DVN) adding 2%.
Tesla (TSLA) shares rose as the EV maker reduced prices on some of its Model 3 cars in the U.S. Shares of DXC Technology (DXC) gained following release of the data processing services firm’s financial report.
Oil futures were little changed. Prices for gold and other precious metals gained. The yield on the 10-year Treasury note was up. The U.S. dollar slipped versus the euro, pound, and yen. Most major cryptocurrencies traded higher.